Real-World Economics Review

from Lars Syll If you can’t devise an experiment that answers your question in a world where anything goes, then the odds of generating useful results with a modest budget and nonexperimental survey data seem pretty slim. The description of an ideal experiment also helps you formulate causal questions precisely. The mechanics of an ideal experiment highlight the forces you’d like to manipulate and the factors you’d like to hold constant. Research questions that cannot be answered by any...

The financial sector produces a lot of wealth... and waste. Dean Baker explains why it's bloated and broken. Since the 1980s, the financial sector has been permitted to expand greatly, with deregulation and practically no taxes. This was all done in the hope of improving efficiency in the allocation of capital and the economy overall. But Dr. Baker shows that while the financial sector has grown, it has not fulfilled its promise - it has not improved productivity, it ties up and wastes a...

from Lars Syll Tax cuts for the wealthy were supposed to stimulate growth and make everyone better off. There was dispute about this within the profession, but there were also many economists who provided intellectual support for the claim that tax cuts will create growth and widespread prosperity. The evidence from the Bush and Reagan tax cuts does not support this claim, but it is still made by some economists and this gives those who are serving wealthy interests or who want to force...

After reading her contemporary Alfred Marshall, reading Rosa Luxemburg (born in Poland, 1871-1919) is a joy. The clarity of the prose, the consistence of the arguments, the sheer knowledge of events and facts. She backed an anti-imperialist socialist agenda coupled with – no, based upon – differences of view and discussion in combination with cultural and linguistic diversity. In my view, she would have backed the growth of international food supply chains binding Ukraine, Russia, Turkey...

Movington.com, CEO Dean Baker on a mountain in Las Vegas, NV. Dean is saying don’t take one of those online “quick cash sales” and under value your home. Give Movington.com a opportunity to get the most money for your home.

from Dean Baker The Inflation Reduction Act includes a remarkable innovation. Share buybacks will be taxed at a 1% rate. This is a huge deal, not only because it taxes money that was often escaping taxation at the individual level, but it is a move away from basing the corporate income tax on profits, which can be easily manipulated, to taxing returns to shareholders. It is time for a major and simple overhaul of the corporate income tax system. The main problem with the current system is...

from Peter Radford Taking a short break from my crusade to get information taken more seriously in economics … Yesterday’s Financial Times includes, on page 9 of the print edition, one of its regular “Market Insights” columns.  This is the space the FT allocates to sundry financial market types to opine on subjects of general interest to other financial market types.  It’s always a good read if you want to gain insight into how our magnificent financiers talk to themselves whilst...

Dean Baker explains how CEO pay has increased enormously over the past four decades while shareholder returns have remained low. Weak corporate governance has allowed management to 'capture' corporate boards – and push through massive executive pay increases. Baker shows how in many cases their compensation has nothing to do with the return to shareholders. Baker breaks down the CEO pay scam into four parts: patterns of CEO pay, the alternative argument for CEO pay, evidence that CEOs...

READ MORE: Two people are wanted by local authorities in connection to the death of a missing 30-year-old.

from Lars Syll The model is not . . . how one determines the soundness or otherwise of a mathematical proof; it is, rather, how one determines the reasonableness or otherwise of entries in a crossword puzzle. . . . The crossword model permits pervasive mutual support, rather than, like the model of a mathematical proof, encouraging an essentially one-directional conception. . . . How reasonable one’s confidence is that a certain entry in a crossword is correct depends on: how much support...